A Short-Term Rental or STR provides short-term lodging for compensation under an oral or written agreement. STRs are not permitted in Lake Forest and are a prohibited use in all residential areas (a single exception is for Limited Home Rental).
The City Council adopted the Short-Term Rental Ordinance in August 2017. The Ordinance prohibits non-owner occupied properties from being leased for profit for less than 30 days. However, there is an exception for Limited Home Rentals (owner-occupied dwelling units) that may be rented for limited periods of time. The City Council adopted the STR Ordinance in response to resident complaints regarding noise, traffic, and parking.
STRs are not legal, but remain subject to the collection of Transient Occupancy Taxes (“TOT”) for every night the property is used as an STR plus Penalties.
A Short-Term Rental is considered a misdemeanor violation of the Lake Forest Municipal Code and a fine of up to $1,000 per violation. If you are found in violation, the City may file lien against your property to collect taxes and penalties.
The City contracts with a company called Hinderliter De Llamas and Associates (“HdL”) for tax collection services. Both STRs and Limited Home Rentals must be registered with HdL. TOT payments through HdL may be made online at the TOT Payments Website.
Learn more about Short-Term Rentals with this Short-Term Rentals FAQ.
Check out this quick and easy Short-Term Rental Fact Sheet to identify if your property is being used as a short-term rental and the next steps you will need to take.
A Limited Home Rental is the rental of your entire primary residence for up to 3 periods fewer than 30 consecutive days (cannot lease a single bedroom). These are owner-occupied residences that may be leased under limited circumstances, but primarily serves as the resident’s home. The resident cannot remain on property when it is leased as a Limited Home Rental. Limited Home Rentals may be rented for a period of less than 30 consecutive days, but no more than 90 days in a calendar year. A Limited Home Rental must be registered with the City and is subject to Transient Occupancy Taxes.
Learn more about Limited Home Rentals with Limited Home Rentals FAQ.
A Long Term Rental is the rental of a property for more than 30 consecutive days such as a month-to-month lease or year-round lease. Long Term Rentals are permitted as long as there is not more than one verbal or written agreement for the property. A property with more than one agreement is considered a Boarding House and also prohibited by the City. A Long-Term Rental is not subject to TOT and does not require approval by the City.